Call to Order and Roll Call
The 2nd meeting of the Interim Joint Committee on Licensing, Occupations, and Administrative Regulations was held on Friday, July 14, 2017, at 10:00 AM, at Country Boy Brewing Company, 108 Corporate Boulevard, Georgetown KY. Senator John Schickel, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator John Schickel, Co-Chair; Representative Adam Koenig, Co-Chair; Senators Joe Bowen, Jimmy Higdon, Christian McDaniel, Dan "Malano" Seum, and Damon Thayer; Representatives Al Gentry, Dennis Keene, Chad McCoy, Jerry T. Miller, C. Wesley Morgan, Kimberly Poore Moser, David Osborne, Ruth Ann Palumbo, Phillip Pratt, Sal Santoro, Arnold Simpson, Diane St. Onge, and Walker Thomas.
Guests: Representative Lynn Bechler; Mark Gary, Holland Electric, Mark Kramer, Townsley Electrical Contractors, Robert Weiss, Executive Director, Kentucky Home Builders Association, Troy Corrigan, Corrigan Electric, Carol Reynolds, United Industrial Services; Jeff Hinckley, HVAC Services, Glasgow, KY, Jerry Douglas Price, Big Sandy Heating and Air, Prestonsburg, KY, Leonard Heuser, ACCO, Louisville, KY; Daniel Harrison, Partner, Country Boy Brewing, Adam Watson, Against the Grain Brewing, The Kentucky Guild of Brewers.
LRC Staff: Tom Hewlett, Bryce Amburgey, Jasmine Williams, Melissa McQueen, and Susan Cunningham
Welcome
Senator Damon Thayer, and Representative Phillip Pratt, along with Daniel Harrison, Country Boy Brewing, welcomed committee members to the new brewery and tap room. Mr. Harrison added that he appreciated the support of the legislature in expanding the micro brewing industry.
Minutes
The minutes of the June 7, 2017 meeting were approved without objection.
Licensure for Electricians
Representative Sal Santoro explained that Senator Whitney Westerfield would be the primary sponsor for the bill that was being discussed today, but Senator Westerfield had another obligation so Representative Santoro was filling in.
Mark Kramer, President of Townsley Electrical Contractors in northern Kentucky, said he started his business in 1970. When he started, there was no apprenticeship program or requirement for electrical licensure. There were a few areas that required a master electrician to have a license, with all other employees working under that license. Prior to 2003, the master’s license served as the contractor’s license in Kentucky. In the 1970s, in some areas of the state, the licensing board had an experience clause. The clause required the builder to acquire three or more signatures stating that he or she had been working as an electrical contractor for 5 or more years before the board would issue a license. This clause no longer exists. Another issue during the 1970s was lack of required liability insurance. Now liability insurance in the amount of five million dollars is common.
Presently, each company is required to have an electrical contractor’s license, obtained through a test relating to business. Each company must have an electrician master’s license, obtained by passing a test related to the National Electric Code. Each company must have at least one licensed electrician on every job site. That license can only be obtained by passing a test related to the National Electric Code. Electricians and state electrical inspectors are better educated today.
The industry is safer today; however, requirements are more stringent than necessary, which is creating a crisis in the electrical workforce. The bill that will be proposed for the 2018 Regular Session basically keeps the same rules but will lessen training time, so that if a person worked four years, the person is eligible to take the electricians test, or two years in a two-year approved training program. Ohio is taking Kentucky’s electricians across the river to work because its law does not require a journeyman to have a license; only a master electrician must be licensed for a job.
Mark Gary, Holland Electric Company, Inc. Hopkinsville, KY, said in 2003, 4,203 electricians were grandfathered a license for electrical work. Similarly, 17,183 master electricians were grandfathered. Current data on renewed electrical license applications is 5,805, with only 2,220 active. Master electrician renewal applications totaled 19,561; active today are 9,117. With half of the workforce gone, the electrical industry needs help.
Bob Weiss, Executive Director, Home Builders Association of Kentucky said there is a severe workforce shortage in the industry. Two of the local chapters have schools teaching electrical, plumbing, heating and cooling and carpentry. He said safety is the main goal. If shortening the number of years required to become a journeyman electrician helps grow the workforce, his industry will support the idea.
Troy Corrigan, Corrigan Electric, Louisville KY, representing the Independent Electrical Contractors Association said he was against changing the training to two years. The association does not believe the National Code electrical requirements can be learned in two years. Kentucky is recognized as one of the top five states for electrical safety. Reducing the training to two years will put Kentucky in the bottom five. The four year training program meets guidelines of federal standards.
Carolyn Reynolds, owner of United Industrial Services, Louisville KY, said if the bill reduces the standards of training there will not be anyone who knows her line of business. The reason for licensing was to regulate safety and efficiency. No one who was grandfathered in was tested, but only had to prove they had been working as an electrician for five years. This dilutes the industry’s skill set of requirements to be a master electrician. Current requirements for a journeyman license are 600 hours of education, four years of on the job training, and a proficiency test. Most states do not reciprocate with Kentucky because of the grandfather clause. Electricians who work for her in multiple states have commented that the Kentucky test is the easiest to pass.
In response to a question from Representative Koenig, Ms. Reynolds said there are two tests, a journeyman and a masters, the first test is less complicated. Journeyman, after passing the proficiency test and working in the field two more years, can take a more difficult test and become a master. Mr. Carrigan said that Experior conducts the proficiency test, adding that the problem with the attrition of electricians was the grandfathering, and those electricians now leaving because of their lack of knowledge. Mr. Kramer said the change he is asking for is to shorten the requirements for the journeyman test. The journeyman is working for a master electrician who plans the design and circuitry layout. Reciprocity is a problem in part due to Kentucky grandfathering and because of Kentucky’s stringent rules for licensing.
In response to a question from Representative Pratt, Mr. Corrigan said there is a shortage in the electrical workforce. One problem is getting people trained to state and federal standards. Mr. Kramer added that the younger work force is put off by the amount of training required to become an electrician.
In response to a question from Representative Keene, Mr. Kramer said everyone has a different type of work they prefer, some excel at residential work while others prefer industrial work.
In response to a question from Senator McDaniel, Mr. Corrigan said in order to hold a state license for a journeyman a person must have four years of experience, and six years for a master license. Ms. Reynolds said that it is possible to learn to wire a house in two years. However, in two years it is not possible to also learn how to work in the industrial side of the electrical work.
In response to a question from Representative St. Onge, Ms. Reynolds said a person with extensive knowledge of the National Electrical Code could possibly pass the written test without working experience.
Senator Bowen said that this situation was a reflection of the problem in society today. There are many fields with the same set of problems. Younger people have little interest in careers other than technology.
HB 236 (17RS BR 1011) – AN ACT relating to organ donation.
Representative Lynn Bechler said that this bill passed the House during the 2017 Regular Session. Organ donation is supported in Kentucky by asking people who have a driver’s license to become organ donors. People who agree have their choice designated on their driver’s license. Hospitals are required to contact the Kentucky Organ Donor Affiliates, or KODA, if someone has indicated they want to donate organs. But coroners and medical examiners are not held to this requirement. Time is of the essence in organ transplant, there is only a 24 hour window. HB 236 will require a coroner or medical examiner to notify KODA.
In response to a question from Senator Seum, Representative Bechler said penalties would be the same for coroners and medical examiners as they are for hospitals.
Licensure for the Building Trades.
Jeff Hinkley, HVAC Services, Glasgow, said HB 519 from the 2017 regular session allows people from out-of-state, with military experience of 5 years that is equivalent to a master HVAC licensure experience requirement in Kentucky to test for a HVAC license. This clause leaves out the people that are Kentucky residents who want to pass their business on to their children who have worked in the family business their entire life and have on-the-job training. Similarly, a person who has run a company for multiple years, but has not worked in the field, cannot sit for a master’s test because they do not have five years of working experience or a journeyman license. This legislation will allow a parent to pass a business to a child by letting the child take the test.
Also, regarding transferring a business, Kentucky law currently states that a master contractor is allow to own one business. Therefore if an owner wanted to sell his business, a prospective buyer who is already in business would not be able to buy the second business and operate it as a separate business, retaining its old name that customers identify with. Instead, the buyer would be required to incorporate it into his or her existing business. This could potentially harm the business by reducing its name recognition in the area. The language proposed in the bill would allow a contractor to own more than one business with restrictions included to require at least a 25 percent ownership in each firm and require the contractor to be domiciled in Kentucky.
Leonard Heuser, ACCO, Inc., Louisville, said he was a licensed HVAC contractor with 39 years of experience. He said he is a small business owner. Over the years property management companies have been using unlicensed employees to transition from simple maintenance tasks to making major repairs to HVAC equipment and then bill property owners. HB 519 clarifies the definition of routine maintenance and repair work and who performs this work.
Another component of this bill is establishing a 180 day grace period in the event of the death of a company license holder. Currently if a license holder dies, that company is immediately operating as an unlicensed contractor. This will also apply to licensed master plumbers and electricians.
In response to a question from Senator Higdon, Mr. Heuser said there could be changes to make the definition of major repair less vague.
Jerry Price, Big Sandy Heating & Cooling, Paintsville, KY, stated that he, as a small business owner, was present to support this legislation as a representative of the Kentucky Association of Master contractors. He told the members that if he died today, 18 employees would be out of work. Having 180 days would give his journeyman time to take the test and keep the business open.
The Microbrewery Industry in Kentucky.
Adam Watson, one of the owners of Against the Grain Brewery in Louisville KY and President of the Kentucky Guild of Brewers, as well as Daniel Harrison, co-founder of Country Boy Brewing and Vice-President of the Kentucky Guild of Brewers thanked the members of the committee for their support in the growth and success of the industry.
Mr. Watson said growth in the craft brewing industry is nationwide. The economics of craft brewing in Kentucky are examples of small businesses creating jobs and expanding the tax base. The craft beer industry made up more than 424,000 jobs nationwide in 2016. Kentucky now has 53 licensed craft breweries and 19 additional brewery locations in the planning stage. Kentucky craft brewers directly employ more than 600 people. Brewers partner with the Kentucky Department of Agriculture; Tourism, Arts, and Heritage Cabinet; and the Economic Development Cabinet. Currently Kentucky ranks 46th in breweries per capita. The industry has a ripple effect across the state benefiting manufacturing, construction, transportation, affiliate industries, and service industries supported by the craft beer industry.
Craft breweries are locally owned and support local economies, businesses, charities, tourism, and farmers. Tap rooms and festivals draw a positive economic impact for Kentucky. The Tap room experience with special product releases and collaborative beers and special events such as the Kentucky Fest of Ales and CraftBash help boost the tourism economy.
The Guild will have a legislative request for consideration during the 2018 General Assembly. Items they wish to address are privileges or prohibitions among producers, and changes to enhance craft brewers ability of compete with craft brewers in bordering states as well as nationally. Also, to align statutory provisions with modern business practices. Their priorities are to attract and grow business, broaden the tax base, and generate revenues.
Senator Seum said in 1966, at his restaurant, he had home grown Louisville beers on tap such as Oertles ’92, Falls City, Fehrs, Wiedemann’s, Sterling, Hudepohl, and many others. One at a time the bigger companies bought these smaller ones, and people who worked in those breweries in the neighborhood lost their jobs. Now there are 18 small breweries in Jefferson County because of this industry and the legislative changes.
Administrative Regulations
201 KAR 34:020, 201 KAR 34:030, and 201 KAR 34:050.
Marcus Jones, attorney for the board, said that the board is now going to offer a continuing education to licensees and to Art Therapists Supervisors. Therefore the board has created a fee to process the examination. The exam will be given on paper as well as online. The online exam will be maintained by the state with a $10 per credit hour fee assessed for each examination up to three credits. Mary Beth Orton, Chair of the Board of the Kentucky Board of Licensure for Professional Art Therapists said there would be new training based on the creation of the continuing education exam.
Representative Koenig was recognized to announce that the August meeting would be moved from its regular date, August 11th to August 18th and 10:00 AM in Room 129 of the Annex.
There being no further business to come before the committee the meeting was adjourned at 11: 17 AM.